The Fight To Harness The Sun

 

A cynic would suggest that oil companies moved into the photovoltaic business with one thing in mind. In 1978, Robert Willis founded Solenergy Corp., a still-small company making single-crystal silicon cells in Woburn, Mass., but before that he was president of Solar Power Corp., the Exxon Enterprises affiliate. "After I left Exxon," Willis says, "people would come to me and say, 'Now, tell the truth. Isn't Exxon trying to suppress the technology?' Well, the whole time I was president there, nobody at Exxon ever pulled me aside and said, 'Bob, take it easy here. We're trying to push up the price of oil."

But a pragmatic person would suggest that however honorable the oil companies' intentions, their presence in this still-emerging alternative energy industry has been a mixed blessing at best.

On the positive side, oil companies have been the largest single source of private R&D capital in the industry. Companies like Solarex, which has developed a cell that is less costly than single-crystal silicon and, reportedly, more efficient than amorphous silicon, and Energy Conversion Devices Inc. in Troy, Mich., which claims to have developed an even less costly amorphous silicon cell technology, probably wouldn't exist today without R&D support from petroleum profits.

On the negative side, companies without oil-based backing find it nearly impossible to raise capital. When an independent photovoltaic company tries to raise venture capital, says Edward Blum, a vice-president of Merrill Lynch White Weld Capital Markets Group in Washington, D.C., and director of the alternative energy financing group, "the first question they are asked is, 'Flow are you going to compete against the oil companies?' " Hambrecht & Quist, a San Francisco investment banking firm with a reputation for spotting good venture capital opportunities in high-tech industries, is looking into new energy technologies. "But," says Jeana Hurst, an associate in Hambrecht & Quist's corporate finance department, "[photovoltaics] is a little longer term than we're looking for. We don't have the funds to compete with the big oil companies. They tend to be in for the long haul, while a venture capitalist wants a company to grow and go public in a few years."

Even companies not considered small by most measures, RCA Corp. and Westinghouse Electric Corp., for example, are sitting on the solar technologies they have developed rather than putting up the capital to bring them to market. Westinghouse, says a spokesman, is "looking for a way to spread the investment risk."

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